By Tiernan Ray

Morgan Stanley’s Katy Huberty, who follows Apple (AAPL), and her colleague Jerry Liu, write that shipments of both Apple’s, and Samsung Electronics‘s (005930KS), smartphones, appear to be tracking ahead of expectations through the end of last week, citing a drop-off in Apple’s production recently, phone company promotions that induced purchases, and promotions at retail.

Huberty and Liu cite their own “AlphaWise” survey, which they claim has been accurate in past gauging the direction of sales. Here’s the chart from the report:

We believe demand in the US improved due to carrier and retailer promotions. Western Europe benefited from a better macro environment. NTT DoCoMo’s launch in Japan boosted demand in the region. However, China had tougher comparisons in C1Q14 due to the earlier iPhone launch compared to past years. China Mobile likely offset the difficult comparisons slightly, but we expect the majority of the benefit in late 2014 as subscribers wait for the next generation, larger-screen iPhones. Samsung Galaxy C1Q14 demand is tracking to 41M units, down 11% from the previous quarter. Despite the slowdown in Galaxy S4 and Note 3 shipments, which we estimate accounted for 18M units in the quarter, demand continues to be driven by the launch of several Galaxy S4 variants (Active, Google, Mini, Zoom, Mega) and lower-priced versions of Galaxy smartphones. We expect Samsung to ship about 91M (+4% Q/Q) total smartphones in C1Q14. Therefore, volume is likely to beat consensus in the current quarter but overall mix will be weaker due to lower-priced phones and mix shift towards China.

Newer spins of Samsung’s Galaxy S4 smartphone are helping the company, but contrary to Apple’s lack of pickup in China, success there is going to hurt pricing for Samsung:

Samsung Galaxy C1Q14 demand is tracking to 41M units, down 11% from the previous quarter. Despite the slowdown in Galaxy S4 and Note 3 shipments, which we estimate accounted for 18M units in the quarter, demand continues to be driven by the launch of several Galaxy S4 variants (Active, Google, Mini, Zoom, Mega) and lower-priced versions of Galaxy smartphones. We expect Samsung to ship about 91M (+4% Q/Q) total smartphones in C1Q14. Therefore, volume is likely to beat consensus in the current quarter but overall mix will be weaker due to lower-priced phones and mix shift towards China.

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There are 4 comments

MARCH 19, 2014 3:31 P.M.

Peter wrote:

F these Analysts Everyone has a A hole too.

MARCH 19, 2014 3:40 P.M.

Paul wrote:

Janet Yellen to the rescue. We are all F'ed now!

MARCH 19, 2014 5:01 P.M.

Anonymous wrote:

Thanx Katy. But I want them to do something. Even a shoe store would be more exciting because at least you'd get a few trap shots.

MARCH 19, 2014 5:48 P.M.

Rottan Frewt wrote:

Apple will miss iPhone expectations again, as usual, and the share price will drop even further. That will come as no surprise to me.

The harder analysts pound the table for Apple to rise, the faster the shares will fall. Tim Cook is simply sucking all the shareholder value out of Apple. He seems to think that $160 billion in reserve cash is for his own personal enjoyment. Google and Android is simply crushing the life out of Apple when it comes to smartphone market share. Market share is everything to Wall Street and Apple won't be worth a damn as the iPhone continues to lose smartphone market share.

Tim Cook just doesn't get it. iPhone sales are a dead end for Apple and they need to find some other source of revenue to boost the company's value. Use that reserve cash to buy some shareholder value. Don't throw it away on stock buybacks. Apple is the only one buying Apple stock. The rest of Wall Street is buying Google, Amazon, Netflix and Priceline. You want to know why Google is worth $1200 a share and Apple is struggling to hold $530? Because Apple stock is toxic. No investor with any sense will touch Apple stock. It's dead money. Wall Street hates Tim Cook and his holier-than-thou attitude.

About Tech Trader Daily

Tech Trader Daily is a blog on technology investing written by Barron’s veteran Tiernan Ray. The blog provides news, analysis and original reporting on events important to investors in software, hardware, the Internet, telecommunications and related fields. Comments and tips can be sent to: techtraderdaily@barrons.com.